COLORADO SPRINGS (AP) – On the surface, the numbers are encouraging: The Colorado Springs area’s unemployment rate declined by nearly a third, from 7.8 percent in October 2013 to 5.4 percent in October of this year.
But dig a little deeper, and a bleaker picture emerges. Nearly half of the drop in the jobless rate resulted from more than 3,500 area residents leaving the local labor force. The cause is unclear since there’s no up-to-the-minute U.S. Census data that might help explain it.
Experts say demographics play a role: Statistics show that more baby boomers are retiring and young adults are staying in college longer – trends that are playing out around the country.
But a more troubling reason is that people are leaving Colorado Springs to find good-paying professional jobs, which is the situation for Jimmie and Vanessa Richardson. Weary of commuting to Denver every weekday for their information technology jobs – a trip they’ve made for 2½ years – the couple plan to sell their longtime home in Briargate and move to the capital city area.
“The job market in Colorado Springs is not one for technical professionals unless you are military or former military; the pay isn’t commensurate with the experience level,” Jimmie Richardson said. “You can make at least $20 to $25 an hour more in the Denver area than you can here.”
That fits with demographic research conducted by Fred Crowley, a local economic consultant who retired about six months ago as senior economist for the Southern Colorado Economic Forum. While his research focused on an earlier time period - 2010 to 2013 – it showed that baby boomers were leaving the Colorado Springs job market in droves: More than 14,000 had exited during the three-year period.
His research also concluded that more than 4,700 residents in their prime working years – ages 35 to 54 – had exited the local job market during the same period.
The reason, he believes: Wages in the Colorado Springs area have declined since 2000 as the local economy has traded high-paying jobs in manufacturing, information technology and construction for low-wage jobs in the hotel, restaurant and call-center industries. The average pay of jobs that were lost is nearly three times higher than the jobs that replaced them, resulting in a decline in the area’s wages of more than $150 million between 2010 and 2013.
“This is scary. We need to grow technology and manufacturing,” Crowley said. “Most of the people who have dropped out of our labor force probably have left the area. The inference is that they lost good opportunity, and there are no longer good opportunities here.
“Without high-wage jobs, average incomes will continue to decline, residential housing prices could soften and consumer purchasing may decline,” Crowley warned. “Unless corrected, we face a dark economic future in El Paso County.”
The lower-wage jobs also have been blamed for an exodus of young professionals, which could hurt the local economy long term. Tatiana Bailey, director of the Southern Colorado Economic Forum, said it is important to retain younger workers since they start businesses at a much higher rate than older workers – and startups are a key driver of local economic growth.
Local economists say another factor that might be keeping younger adults out the job market is the growing number of veterans in El Paso County who suffered mental and physical injuries during deployments to Afghanistan and Iraq. Veterans benefits paid to El Paso County residents more than doubled between 2007 and 2013 to $530.8 million, according to the economic agency.
